IS YOUR AGRIBUSINESS MAKING THE MOST OF TAX RULES, GRANTS AND INCENTIVES?
13 June 2020 | Agribusiness
Kennas’ accountants and financial planners have been working with Central Queensland’s primary producers since our earliest days 120 years ago. We understand that agribusiness takes determination, resilience and courage to stay the course, in good times and bad.
It’s important to have financial know-how backing you up. We make it our business to stay right up to date with every available government grant, tax assistance program or compliance regime to help you make the most of what’s appropriate to your unique agribusiness.
Pay as little tax as possible
Before the end of the financial year, take the time to review your situation and take action to minimise your tax liabilities. For example, a number of rural agencies such as Landmark, Elders or Ruralco Finance offer prepayment facilities, so you pay the following year’s expenses in June and claim a tax deduction this year instead of next (this is provided you meet the ATO’s definition of a Small Business Entity).
These facilities work by accepting an upfront payment, from which they will pay you a 4.15% ‘reward’. Then over the next 11 or 12 months, goods are purchased to use the amount of the prepayment. This strategy can work very well if you have a high-income year and are looking to bring forward and maximise tax deductions this financial year.
Contact your Kennas accountant to check on the commercial aspects and ensure you are eligible to benefit from these prepayment facilities.
There is other assistance available in certain circumstances for primary producers, such as tax offsets or deferrals. Did you know that you’re able to defer profits on forced disposal or death of livestock?
Make the most of government grants
You might be surprised to find out just how many different government grants and assistance programs are on offer. The Queensland Government’s Grant Finder helps you work out the grants your business may be eligible for. The Federal Department of Agriculture lists a laundry list of programs, and even a quick Google search reveals extensive lists of grants, programs, insurances and assistance. You may not have time to research and check each one for suitability – a farmer’s work is never done!
There is a shortcut to finding grants – it’s the team at Kennas. We’ll let you know which grants are worth applying for in your situation and guide you through every step of the application, then back you up while you use and correctly acquit any funds received.
Keep in mind there’s no guarantee a grant application will be successful. That’s one reason the next type of assistance can be appealing…
Be rewarded for R&D
Innovate, and you reduce your tax. That’s the idea behind the Research and Development Tax Incentive (RDTI). It provides R&D tax offsets to encourage businesses to innovate and engage in R&D, including agribusinesses who meet the criteria and regulations. It is meant to encourage producers to undertake research and development that they might not otherwise attempt.
If eligibility is established from the outset, and accounting and processes are set up correctly, this incentive can help future-proof your farm and bring your innovative ideas to fruition.
But there are a few fences to scale and many gates to close – financially speaking. We want to help you undertake R&D correctly and avoid any unnecessary reviews, fees or even potential repayment of the benefit.
A little perspiration will be worth it
Remember Edison’s words – ‘Genius is 1% inspiration, 99% perspiration’. You’ve got the innovative ideas and you know that you’re up for the ‘perspiration factor’ – and that’s all good. Let us help you share the load and if you’re eligible, apply for the grants and tax incentives. The effort can be well worth it.